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Biotech / Medical : GUMM - Eliminate the Common Cold
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To: Eric Fader who wrote (459)3/31/1999 8:26:00 AM
From: DanZ  Read Replies (1) of 5582
 
Eric,

Thanks very much for your comments. It's reassuring to know that a non-shareholder like yourself, who should be unbiased, doesn't think that my optimism is overdone.

With regard to Zicam and the end of the cold season...

Yes, we are near the end of the current cold season. But, the cold season will get rolling again in the Northeast in September, October or thereabouts? That's only seven months away and stock prices discount the future. When you add in that sales of Zicam are ahead of the company's expectations during a period that could be considered the end of the cold season, you have to be positive. I don't see any other way to look at it and I'm trying hard not to be biased because I am long the stock.

Zicam is only being sold in a few major retailers. While significant for a new product from a company with no history in the cold remedy market, GumTech's current distribution is very small when compared to the total market. Check out quigleyco.com for a partial list of potential retailers. The market is huge and GumTech has only just begun distribution.

Between now and the beginning of the cold season, I would expect many of the retailers on that list to purchase Zicam in anticipation of the next cold season. In other words, I'm expecting channel filling to bring in revenue before the cold season starts and sell through to bring in revenue after the cold season starts. Zicam is selling well in retail stores according to the company and you have to expect this to pick up more during the cold season.

Best of luck and thanks again for keeping me in check.

Dan
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